Case Law Details
HCC-SEW-MEIL-AAG JV Vs Assistant Commissioner of State Tax & Ors. (Supreme Court of India)
SC issues notice on SLP challenging validity of notification no. 09 & 56 of 2023 extending limitation for passing orders u/s 73 of CGST Act
The Supreme Court has issued a notice on a Special Leave Petition (SLP) challenging the validity of Notifications No. 09 and 56 of 2023, which extended the time limit for adjudicating show cause notices under Section 73 of the Central Goods and Services Tax (CGST) Act. The case questions whether the government could extend the statutory timeline for adjudicating tax demands for the financial year 2019-20 through such notifications issued under Section 168-A of the CGST Act.
Senior Advocate Dr. S. Muralidhar, appearing for the petitioner, argued that various High Courts have expressed differing views on the legality of such extensions. This divergence in judicial opinion has led to significant uncertainty in tax adjudications. The Supreme Court acknowledged the importance of the matter and has sought responses from the respondents. The case is scheduled for further hearing on March 7, 2025.
The primary contention in the petition is that the government’s notifications violate taxpayers’ rights by retroactively extending the limitation period. The petitioner argues that such extensions through executive notifications undermine legal certainty and exceed the powers granted under the GST framework. This case is expected to set a crucial precedent regarding the government’s authority to modify statutory timelines through subordinate legislation.
A similar issue was addressed by the Supreme Court in Union of India v. Filco Trade Centre Pvt. Ltd. [2022 SCC OnLine SC 912], where the Court ruled that procedural relaxations should not unfairly prejudice taxpayers. Additionally, in CIT v. Vatika Township Pvt. Ltd. [2014 (10) SCC 1], the Court held that amendments affecting substantive rights should not be applied retrospectively unless explicitly stated in law. These precedents may influence the outcome of the present case.
With the Supreme Court now examining the validity of these GST notifications, the judgment will likely have far-reaching implications for tax administration and taxpayer rights. The case will determine whether statutory deadlines under Section 73 can be extended beyond their original timeframe through executive orders. The Court’s ruling is expected to provide clarity on the scope of government power in tax matters under the CGST Act.
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
1. The subject matter of challenge before the High Court was to the legality, validity and propriety of the Notification No.13/2022 dated 5-7-2022 & Notification Nos.9 and 56 of 2023 dated 31-3-2023 & 28-12-2023 respectively.
2. However, in the present petition, we are concerned with Notification Nos.9 & 56/2023 dated 31-3-2023 and 28-12-2023 respectively.
3. These Notifications have been issued in the purported exercise of power under Section 168(A) of the Central Goods and Services Tax Act. 2017 (for short, the “GST Act”).
4. We have heard Dr. S. Muralidhar, the learned Senior counsel appearing for the petitioner.
5. The issue that falls for the consideration of this Court is whether the time limit for adjudication of show cause notice and passing order under Section 73 of the GST Act and SGST Act (Telangana GST Act) for financial year 2019-2020 could have been extended by issuing the Notifications in question under Section 168-A of the GST Act.
6. There are many other issues also arising for consideration in this matter.
7. Dr. Muralidhar pointed out that there is a cleavage of opinion amongst different High Courts of the country.
8. Issue notice on the SLP as also on the prayer for interim relief, returnable on 7-3-2025.
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